The analysis of principal-agent relationships, wherein one person, an agent, acts on behalf of
anther person, a principal.
A theory that the timing of loan payments should be tied to the timing of a borrower’s expected income.
A technique used in Monte Carlo valuation, in which each random draw is used to create two simulated prices from opposite tails of the asset price...
A multivariate model for estimating the cost of equity capital, which incorporates several systematic risk factors and the effects of Arbitrageurs.